Rosebud County, MT - Oil & Gas Discussion

Comment

Comment by William Lee 23 hours ago

Thank you for the info

Comment by Eastern MT yesterday

Mr. Lee, that notice is one of the required steps if Fidelity intends to drill a horizontal well under that section. This does not mean they will, but it is a step along that process. Notification of "Interest Owners" is a required step too. This gives mineral owners an opportunity to oppose the request if they choose to. The fact you received that letter suggests Fidelity believes you own minerals either in section 7, or under an adjacent one.

Comment by William Lee yesterday

I received a letter from Fidelity Exploration & Production notifying me of a hearing on a Application for Temporary Spacing Unit in June 14 2012 in Sidney Montana It was addressed to "Interest Owners" Twp.10 North, Rge.33 East, MPM  Section7: All  asking for a order establishing a temporary spacing unit in Rosebud County. Any one has a idea what this is good or bad or nothing at all

Comment by Connie on May 22, 2012 at 7:33pm

Thanks for your input and help Richard.... It is comforting to know that there is someone out there who is helping us novices try to understand the unique world of oil and gas!!!!  We've been following these oil leases for some time and we honestly never thought that we would live to see them actually produce anything.. Soo,, if nothing happens in our life time then I guess that it was meant to be.... and if all we get is enough money for a dinner out on the town then by golly, it will be a gift greatly appreciated!!  Thanks for your help and advice. We will be following the board on a daily basis.  I'm sure glad that I found you all..!!

Comment by Eastern MT on May 22, 2012 at 5:46pm

Connie, what you posted is positive for you. It suggests drilling MAY be sooner rather than later. This is a needed step towards drilling. However, Fidelity's request for spacing is just one of several steps along the road to drilling a well. There is no guarantee they'll advance beyond their request. Yet drilling on your section now appears more likely than on adjacent ones where no spacing requests have been submitted.

Comment by Eastern MT on May 22, 2012 at 5:38pm

Beverlee thanks for posting info. It helps when we all chip in. Based upon your comments the type of lease you described is now uncommon though it's not unheard of. I might be wrong, but this sounds like a lease with annual renewals (opposed to a "paid up" one with all bonus money up front). I'm sorry it lacks a Pugh Clause. However this is a very common problem (elsewhere I learned the hard way too). I don't like being the bearer of bad news but it is doubtful you can get out of the lease if the Lessee honors the terms as stated. All I can suggest is carefully re-read it so you know exactly what the Lessee is obligated to do. If they fail to perform, then you can take action to break the lease. I know that is not much, but it's all I got.

 

In defense of your Dad and uncle, since the 1950's minerals in eastern Montana have been leased repeatedly with few or no wells to show for it. So offers to lease become thought of as opportunities to pick up some extra money, not as the potentially long lasting contracts. There has been exceptions, yet typically a lease was just a periodic chance for cash every decade or so. I suspect your Dad and uncle's viewed it as another in a line of leases signed today which will expire just like the last one.

Comment by beverlee k on May 22, 2012 at 4:53pm

Diane, I don't see activity on either of your sections yet.  11n-33e-13, and

10n-33e-6 are where 2 of  the temp. spacing units will be placed.

Comment by beverlee k on May 22, 2012 at 4:51pm

The Posiedan is one one of the sections. Central Montana Productions. We owned all the mineral rights on Breed Creek where a big hit was made in the 70's, but my uncle sold the rights for 34,000 in 1957!!!  We had about 200000 acres and held 3/4 of the mineral rights. Only kept 36000 when we sold in 59.  Dumb!!!!!

Comment by beverlee k on May 22, 2012 at 4:44pm

Dianne, our lease was done in Oct. 2007 by BTC Oil Properties. The leasers are my 94 yr. old father and his 82 yr. old brother.  They had been leasing their 36,000 + acres off and on since about 1956.  When they were approached by this company, they just signed the lease without any advice from their children or an attorney.  We didn't even know the terms of the lease, until a year ago after becoming Dad's advisers.  and after having read it, its horrible.  they are getting some kind of a yearly pmt. which varies each year, there is not even a signature from the leasingcompany and there are no terms, we don't know how much per acre is being paid or even why because nothing is stated. Lease is 12% royalty plus a $10.00 net mineral acre for releasing at the end of 5 years, which is Oct 1, of this year. Any suggestions????  We need OUT!!!!! No Pugh clause nothing.  Its horrible.

Comment by Dianne on May 22, 2012 at 8:03am

Our property is 11N R33 E Sect. 34 and 10N R33 E sect 3. It likes as though that we are very close to some of you. This is owned by the Coffee Cattle Co. Please let me know if you see anything happening there. I talked with a representative from Fidelity at the Docket hearing in Butte in April. She said that even though they got the permit, she said that drilling could happen any time or several months from now or not at all.  I asked if any Surface Agreement would be proposed to the landowner before they proceeded. She assured me that yes there would have to be something drawn up first. Many years ago, a driller came to the area and left bags of chemicals on the land and it poisoned the cattle and the wild life predators. They want to make sure that never again. I am in total agreement with that!

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